OPEC: US shale oil plays major role until 2027

By Luke Geiver | September 24, 2018

Tight oil produced from the U.S. will drive non-OPEC oil supply increases expected until 2027. In the next 8 years, OPEC expects non-OPEC supply to increase by 9 million barrels per day. In its yearly world oil outlook report, OPEC outlined several key factors it expects will shape the global oil market all the way to 2040.

Until 2040 (the ending year of the report), oil will remain the fuel with the largest share of the overall energy mix. Developing countries will help expand the global oil demand market by 33 percent. Natural gas volumes will grow the most in that time frame, while renewables will show the largest increase in percentages. For the second year in a row, oil demand numbers rose. This year, OPEC said demand by 2040 will reach 111.7 mb/d. Peak oil is not expected to occur during the report’s time span, but falling battery costs and regulatory support will push the growth of electric vehicles until they represent roughly 13 percent of the global transportation mix.

By 2040, OPEC will supply 40 mb/d of oil to the world, up from the 32 mb/d it supplies now. New refineries will be built, OPEC believes, and will happen mainly in the Asia-Pacific, Middle East, Africa and Latin America.

To maintain the global oil supply through the report period, more than $11 trillion worth of investment will be needed.

At a recent meeting in Algiers, OPEC leaders and representatives from Russia said they did not intend to change their current production schedules or raise production output following the reduction of oil supplied from Iran.